We can buy the bullish pair today.
Today we would take a look at the USD/JPY currency pair. The dollar has prevailed over the yen and has been gradually pushing the price upwards.
The American dollar, despite a slight weakness last week, right now is solidifying its positions. Economic reports continue to support the USD. The most important factor this week was yesterday’s decision of the Federal Reserve to hike interest rates. This propelled the dollar further up. Today we also expect a couple of reports from the US that might affect our pair, most notably trade reports and several GDP statistics.
The Japanese yen doesn’t seem able to win back its lost positions in the near future. The Bank of Japan recently confirmed that they will not change their monetary policy stance, which is quite dovish. They want to continue with their massive stimulus program in an attempt to push inflation to to 2%. Moreover, considering that the most recent tariffs from the US on Chinese goods were lower than expected, investors are not particularly interested in safety assets like the yen right now. Japanese PM Shinzo Abe will be meeting with Donald Trump soon to discuss trade between the two countries.
In terms of the daily chart today we have a pivot point for the USD/JPY pair located at 112.83, with the pair currently trading slightly below it. We expect the rate to continue rising, so look towards the nearby daily resistance levels at 113.04 and 113.35. In case the yen strengthens, look to the supports at 112.52 and 112.31. The indicators of technical analysis are recommending a strong buy in the daily term.
